Soybean and wheat futures at Chicago managed to improve in value after a series of lower closes over the last few weeks. Since the beginning of June corn futures in the US are back about AUD$26.50 / tonne. Offers for sorghum out of Texas are also back a little coming in at US$183 – US$188 / tonne FOB. This comes in at equivalent to roughly AUD$281 NTP NTL, about AUD$40 under current new crop track bids here. Over the last couple of years Australia has sustained roughly a AUD$50 premium over US offers. So the new crop cash bids we are seeing locally are nothing flash considering the current production risk.
Chicago wheat futures were lower. Fundamentally you would expect to see wheat futures firmer but the funds appear convinced current values are more indicative of the market in the USA. Well the market they want to invest in anyway.
Crop progress report out after the close shows corn and beans slipping and spring wheat G/E at 80%.
Saudi Arabi picked up 625kt of 12.5% protein milling wheat in a tender announced late last week. The average price is said to be US$256.57 CnF Sept / Oct. Cargill, ADM, COFCO and Glencore all featured in the supplier list which saw optional origin offers from around the globe including S.American and Australian wheat. At a glance the value appears around AUD$30+ below current values on offer for that grade out wheat out of WA.